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triggering Indeck’s obligation under the Shareholders’ Agreement
to purchase Mr. Polsky’s shares at the PowerLink offer price.17
While the arbitration award contained a fixed amount and a
due date for Indeck’s obligation, this portion of the award never
became legally enforceable. When Mr. Polsky sought to have the
award confirmed, the Cook County Circuit Court, on Indeck’s
motion, vacated the award insofar as it covered the Indeck
shares, on the grounds that the arbitrator lacked jurisdiction.18
17 It bears noting that, in setting the obligation’s due
date at Jan. 31, 1991, and the interest rate at 10 percent, the
arbitrator went outside of, indeed contradicted, the terms of the
Shareholders’ Agreement. The Shareholders’ Agreement provided
that the closing date for the purchase of Mr. Polsky’s shares
need not occur until 13 months after his termination date (which
would have been Oct. 22, 1991), that only 20 percent of the
purchase price need be paid on that date, and that the remainder
could be paid in periodic installments, bearing interest at the
rate provided in sec. 1274(d). Thus, to the extent Indeck claims
it had an “unconditional obligation”, based on the Shareholders’
Agreement, to pay Mr. Polsky $15,030,000 on Jan. 31, 1991, that
claim is inaccurate. The Jan. 31, 1991, due date, as well as the
requirement that the entire balance be paid on that date, arose
entirely from the arbitrator’s Nov. 21, 1991, interpretation of
Indeck’s obligation.
The arbitration award does not indicate whether the
arbitrator’s determination to impose a more onerous due date and
payment terms than those provided in the Shareholders’ Agreement
was based upon his conclusion that Mr. Polsky’s termination was
in violation of the Employment Agreement, thereby voiding the
payment schedule provided in the Shareholders’ Agreement.
18 Under Illinois law, an award in arbitration does not
become an enforceable judgment until it has been confirmed by a
circuit court of that State. 710 Ill. Comp. Stat. 5/11, 5/14,
5/16 (1999). Confirmation may not occur until 90 days after
delivery of the award to each party, during which time a party
may make application to the court to have the award vacated or
(continued...)
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